If you need cash during retirement and you have sufficient assets to be choosy, with which types of assets should you part first? This recent article by Forbes contributor William Baldwin is worth a read on the topic: Estate Planning: A Ranking of Good Assets and Bad Assets. It includes a very helpful ranking of asset types.
Baldwin highlights several key issues to consider, including the step-up in basis at death, how to think about depreciated assets, and withdrawals from traditional versus Roth IRAs. You’ll notice that under current tax law, the reasoning and analysis is largely driven by income tax considerations, rather than the estate tax.
For both you and your heirs, it’s important to understand which assets you should hold throughout retirement, and to which assets you should turn first to pay the bills.
If you have specific questions about these choices and how they fit into your estate plan, please contact me at 406-586-5909 or firstname.lastname@example.org.